Adding partners to a Single member / Disregarded Entity LLC

[Nadav Ben Horin]

Hello All!

I have a single-member LLC which is currently classified as a disregarded entity for taxation purposes.

If I add two partners as members to the LLC, what is the required procedure in order to update the IRS that the LLC is now a Multi-Member LLC?

Thanks in advance.

[Eamonn McElroy]

If you don't have an EIN, you'll need to obtain one.  If you already have an EIN, you'll generally just keep using that.

If you have added additional members, the LLC is now a partnership for federal income tax purposes.

You'll want to have an attorney draft an operating agreement.

Then you'll want to a CPA who has experience in these matters.  i.e. 704(c) issues, substantial economic effect, etc.